Zortman-Landusky mine owner fined more than $500K for alleged mining violations

Using satellite imagery, the Montana Department of Environmental Quality has cited a mine owner and operator more than a half-million dollars in fines for illegally exploring mining without proper permits and warned that years of clean-up and remediation done to alleviate toxic acid mine drainage may be have been undone.

The DEQ cited Luke Ployhar, Blue Arc LLC, Owen Voigt and Legacy Mining LLC on June 20 for multiple violations at the Zortman-Landusky site. Gold mining was in operation there for years until a Canadian-based firm shuttered operations, leaving the state and federal government to clean up acid-mine drainage, partly caused by a cyanide leeching process.

Furthermore, the DEQ in its fines classified them as “major,” and had the chance to reduce the fines because of cooperation or remediation by Ployhar, but chose not to because they characterized Blue Arc as being uncooperative and unresponsive.

“Blue Arc, LLC and Mr. Ployhar have consistently worked with the DEQ, namely with respect to the water treatment on the formerly mined areas, and Blue Arc, LLC and Mr. Ployhar fully intend to continue to do so in response to this most recent misunderstanding,” said Kaden Keto, a Helena-based attorney who represents Blue Arc, in a statement to the Daily Montanan.

On Wednesday, the DEQ confirmed that while it had previously granted Ployhar permission to do a small-scale exploration, no permit for the actual work had been issued, and his company could not proceed until the violations are settled.

The DEQ said that inspections on March 28 and May 27 revealed that Ployhar and his group had “engaged in exploration activities at eight locations on four properties owned by Blue Arc LLC.”

Those activities, according to report, didn’t have proper permits and did not undergo environmental reviews to make sure they would avoid or minimize harm. Furthermore, Blue Arc did not post a bond that would have assured any damage would be fixed.

The DEQ classified the event as “major,” and said that part of that activity disturbed 0.6 acres of land that was affected by previous mining damage and being remediated by the Federal Comprehensive Environmental Response, Compensation and Liability Act, known as “CERCLA.”

The department claimed that Ployhar and others knew the law, and knew they were required to obtain a permit, but disregarded it.

“Yet (they) still engaged in exploration activities prior to obtaining an exploration license. Respondents did not take any reasonable precautions to avoid the violation of exploring without a license,” the report said.

The DEQ’s fines appear to be the most it could levy and Ployhar did not receive any benefit for “good faith or cooperation” which could have reduced the base penalty by as much as 10 percent.

The report also raises the possibility that water that’s being treated for toxic acid mine drainage may be at risk because of the activities.

“The eight locations of disturbance created by respondents have been left unreclaimed since at least Sept. 20, 2021, which creates a greater risk of impact from stormwater infiltration and acid rock drainage,” the report said.

The DEQ said it learned and track the violations through satellite images.

“Each of the eight disturbance locations represents a distinct site of mining exploration, as each site presents a risk for stormwater infiltration and acid rock drainage,” the report concludes.

Inspectors said that the total maximum amount that could have been fined was well above $2 million, but that even the current fines, totaling $516,567 is “an adequate deterrent.”

The DEQ also pointed out that a performance bond for those eight sites would have been approximately $53,000, or cost Ployhar and the companies less than $2,000 during the eight-month time period.

Controversy from the beginning

Ployhar, who previously told the Daily Montanan, that his family has mining ties to central Montana, bought the former mine site in a bankruptcy sale. He said that plans show a huge reserve of gold and other minerals, but the company which went bankrupt simply didn’t have the capital to develop it. He, along with Voigt, told the Daily Montanan that new mining techniques could make mining on the border of the Fort Belknap Indian Community more safe, and bring a needed economic boost to the area.

However, tribal leaders and conservation organizations opposed restarting any mining activities on the site, and a two-day window that was blamed on an administrative delay allowed just enough time for Ployhar to legally apply for mining permits from the Bureau of Land Management, even though the federal agency had planned to continue to run environmental remediation at the site, foreclosing the possibility of restarting the mine.

Fort Belknap leaders also accused the DEQ of not consulting with them before permitting new mining, as well as putting their water source at risk.

“The Aaniiih and Nakoda tribes thank the DEQ for upholding the law and issuing a penalty that is commensurate with the egregious violation committed,” said Jeffrey Stiffarm, President of the Fort Belknap Indian Community. “We will continue to protect our precious water and sacred sites in this area of the reservation. This is exactly why we have been fighting over the years for the return of the Grinnell Notch to us.”